Further to the earlier post, “An agile demand chain” that drew the distinction between agility and flexibility, consider the differences between efficiency and agility.

In many plants, efficiency has been built at the expense of agility, as long runs of product dominate the thinking of many operational managements.

Agility without efficiency is a way to a quick commercial death, as competitors will be aggressive with prices once they realise their costs are lower than yours.  The leading symptom is high unit costs driven by low machine availability.

Efficiency without agility will take far longer to impact, but ultimately is no less commercially lethal, as consumers will abandon an offering that becomes “stale” in a competitive environment. The symptom is high¬† finished goods inventory to accommodate infrequent but long production runs .